Latest housing finance data reinforces need for action on housing affordability

“The latest housing finance highlights the urgent need for a national housing affordability agenda to increase the housing supply and ensure first home buyers are not locked out of the market,” Peter Jones, Chief Economist of Master Builders Australia.

“Only by increasing supply can we solve poor housing affordability by exerting downward pressure on house prices. We need a policy response that works to release the hand break on new housing,” he said.

“The industry remains confident the upturn in residential building will continue, underpinned by finance flows that preceded the February rates cut, and by building approvals that have risen to an historic 20 year high,” Peter Jones said.

“Despite this, the number of first home buyers fell in January to their lowest level in four years and the second lowest number in a decade,” he said.

“The housing shortfall is driving continued deterioration in housing affordability and Master Builders is calling for urgent reforms to ensure the intergenerational home ownership gap does not widen,” Peter Jones said.

“The May Budget will be an opportunity for the Government to respond with pragmatic reforms to ensure that the effect of supply side barriers does not result in first home buyers increasingly being locked out of the market,” he said.

“Master Builders Pre-Budget Submission calls on the Government to work with the states and local councils to remove the shackles on new housing such as poor land release strategies that fail to open up sufficient new brownfield and greenfield land, high and inefficient developer charges and infrastructure levies, and poor planning and approvals processes,” Peter Jones said.